Using a mortgage app: 5 questions to ask

When you’re looking to buy or refinance a home, there are tons of online resources that offer monthly payment estimates. And since today’s consumer demands mobility, those tools are moving from the desktop to smartphones in the form of apps that can be used anytime, anywhere. The results and user experience varies widely among these products, so it’s important that you find the one that gives you the best data in the least amount of time.

To find the perfect app for your perfect mortgage, here are five questions to ask yourself:

Are there built-in assumptions?

Some apps base their results on assumptions, such as loan-to-value and debt-to-income ratio, minimum credit score and residence type. Since people from all walks of life are looking to buy a home or refinance, these criteria only apply to certain borrowers, ignoring the needs and economic situations of many others. There are folks who don’t have 740 credit scores and can’t put down 20% who still qualify for great mortgages.

Are the rates real time?

Mortgage rates can actually change throughout the day. Relevant factors include stock market ups and downs here at home and overseas, local housing market trends, long-term treasury yields, and inflation, to name a few. So it’s important that the app you use is constantly updated with the most recent mortgage rates. A small rate difference can affect your mortgage payment: a $450K loan at 4.1% is roughly $100 less per month than the same mortgage at 4.5%.

Is there a loan officer referral feature?

Shopping for the perfect mortgage is just the first step in making your refinance or home purchase a reality. The loan application still remains, and it is far more involved than the shopping phase. Talking to an expert about the product you like is reassuring, so the mortgage app that identifies a specific loan officer you can contact immediately for advice and rate confirmation may be the one to go with.

Are there obligations?

Some apps are only available to you if you sign up to receive notifications or register to use the company’s products. Finding the right home loan should be as stress-free and obligation-free as possible, especially when you’re just looking to see what rates are available and what your payment will be. During the shop-and-compare stage, you want the zero-commitment app that gives you the most accurate and up-to-date information available. Period.

Do you have to do math?

Some apps ask questions that require you to problem solve prior to entering information. What good is that? The important concepts for a mortgage app are convenience, simplicity and customization. These are lost when a separate calculator or piece of scratch paper is required to populate data fields.

This content was created by Guaranteed Rate, Inc. to promote and advertise its Mobile App. Not all applicants will be approved. Receipt of application does not represent an approval for financing or interest rate guarantee.

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